The latest Boeing and aerospace news, including updates about the Boeing 787 Dreamliner, 747-8 and 737, Airbus A380 and A350, the anticipated Boeing 797 and Boeing jobs and layoffs

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Boeing exec: Airlines aren’t pushing for re-engined 737

Despite public comments to the contrary, Boeing’s major 737 customer airlines are not clamoring for new engines, a Boeing executive said on Wednesday.

“There are virtually no customers I can name off the top of my head, throughout the executive suite, that are pushing us to re-engine,” Nicole Piasecki, vice president of Business Development and Strategic Integration at Boeing Commercial Airplanes, said in Bellevue, at the annual aerospace conference of the British-American Business Council’s Pacific Northwest branch.

Boeing and Airbus have been considering whether to re-engine their single-aisle mainstays or launch replacement programs in the face of new competition from upstarts such as Canada’s Bombardier, Russia’s United Aircraft Corp. and China’s Comac.

At the same time, Boeing and Airbus have each secured dozens of new orders this year for their existing single-aisle jets, which already had big backlogs.

“If you talk to any sales VP today, all they say is: ‘Get me more product. Our customers want more,’” Piasecki said. “At some point in time there will be a moment for a new airplane, a new production program, and we’re working very hard to figure out when that might be.”

Executives at two of the largest 737 operators — Southwest Airlines and Ryanair — have recently been quoted (here and here) saying they want more-efficient airlines.

Asked about that, Piasecki said that, if the airlines want re-engining, “We will look very seriously at doing it.”

Airbus executives have hinted that they will probably go ahead with re-engining the A320, although the company has delayed the decision in recent weeks.

Speaking at a Goldman Sachs investor conference Wednesday, United Technologies Corp. Chief Executive Officer Louis Chenevert said Airbus’ decision might not come until 2011, according to a Bloomberg account.

In Bellevue, Christopher Jones, vice president of North America sales for Airbus Americas, said: “We will make the decision by the end of the year.”

The decision isn’t about deciding whether re-engining makes sense, Jones said. “We’ve gone through the business case. The issue right now is resources.”

Airbus is still trying to ramp up the production rate on its A380 to bring the double-decker airliner closer to profitability, while developing its composite A350 XWB, which will compete against Boeing’s 787 Dreamliner and 777.

Asked last month about Airbus’ apparent hesitation on re-engining, Boeing 737 chief project engineer John Hamilton said: “I think they’re out talking to the same customers we are and they’re getting a similar response, a lukewarm response.”

There’s no question that Boeing and Airbus executives are thinking about the upstart competitors.

The emergence of new competitors is the biggest recent change in the aircraft market, Piasecki said.

“This wonderful duopoly that we’ve had for 15 years that I used to hate, I now love it, but it’s dead. It’s definitely dead in single-aisles,” she said. “With five to seven companies in the sort of 90- to 125-seat market segment it could be very chaotic, very fragmented. … My prediction is that there will definitely need to be some sort of flushing out of players in that segment, but getting from here to there is definitely going to be bloody.”

Government backing of competitors in China and Russia makes it more important than ever to have a rules-based system that allows companies to compete on the product and customer relations, Piasecki said. Improper government subsidies to plane makers have, of course, been the subject of U.S. and European World Trade Organization cases against each other.

The general industry view of Comac’s inaugural C919 model is that it won’t be competitive outside of China but will be something the company can build on.

Concerns about protection of intellectual property are holding back the C919, Philippe Coude du Foresto, vice president of marketing at aircraft supplier Eaton Aerospace Group, said Wednesday. “We only exposed mature technology, things that we don’t value long-term in terms of differentiating from the competition.”

Asked about how long it would take the C919 to become competitive in North America and Europe, Boeing’s Piasecki said: “I learned a long time ago from my good Airbus competitor that it isn’t just about the airplane capability, and China will be the power as we look forward economically, geopolitically. … But it has to be safe, and I think they know it.”

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